Is it worth buying a duplex somewhere to live in and rent if I will be moving in a year?

Question

I am going to be living in Denver starting in August.  I was wondering if is it worth buying a duplex somewhere to live in and rent out the other side if I will be moving in a year?  I would have to mortgage the duplex also.

Scott Trench · Answer

I think that this is a mistake - just my personal opinion though.  One of the great things about being an owner-occupier is the fact that you get to manage one of the the easiest businesses of all time.  I'm not saying that real estate is easy so don't misquote me there, but relative to almost any other business you can purchase that has a reasonable chance at producing revenue, the property manager/house-hacker has to be up there.

Your tenants are right next door - you know if they aren't treating the property well.  You know where the check is coming from.  You can go and fix problems in seconds, 10 feet away.  Maintaining the property is virtually the same as running a household.

Hiring a property manager to manage my duplex would likely cost me around $200 per month.  Managing the property was a grand total of 20 minutes last month.

This is a very different story if I had 5 rentals or had rentals more than an hour away, but the managing I do is less than 20 yards from where I sleep!  I'm not busy or rich enough to say no to a $200 per hour job.

Elizabeth Colegrove · Answer

my husband is active duty and we move a lot. I have written how having a transient life style can be amazing. We buyall houses even those we live in with the mind for future rentals. We have done very well as the interest rate and down payment are much lower!

Dan Mackin · Answer

Disclaimer - I work for Micki

Micki M. has some great people including herself that could help you out.  You could also see this thread for more info.

https://www.biggerpockets.com/forums/21/topics/181...

Scott Trench · Answer

I don't know about a partial manager - I haven't considered one to this point.  I just can't see many emergencies arising that I couldn't take over the phone and call the plumber, electrician, police, or handyman.  My tenants have called me about various minor issues, and each time, I asked them if it was ok if I took care of it on a prompt timetable, but convenient to both of us.  This includes a minor plumbing issue, screen repair, and facilitation of online rental payments.  That said, everyone is different.  If I was making less than perhaps $50-$100 per hour at my job though, I think I'd be happy with the $200 per month in my pocket for relatively convenient work.

Dan Mackin · Answer

@Scott Trench

What about having a partial manager?  If you don't have the time to take the calls that may possibly come in when you're out of town or swamped at work wouldn't some sort of management be helpful?

Brandon Monaghan · Answer

I really appreciate all of the feedback everyone!  Does anyone have recommendations for someone to contact for homes in Denver?

Matthew Schroeder · Answer

@ brandon monaghan I did that exact same thing with our duplex in Denver so it is definitely doable.  Just make sure that you are comfortable with the PM.  Interview a few & while you are physically living in the unit, "test" the one which you choose to see if they operate in a way that you like.

Michael Noto · Answer

If the numbers make sense as an investment, yes it is worth it.  Especially if you can take advantage of the low money down and low rate of a 1st time homebuyer loan.  Be sure to check while researching financing options how long you are required to live in the home to get owner occupied financing.

Dan Mackin · Answer

@Brandon Monaghan

Yes, you could have them cover one side and then have them transfer over to both sides when you're done there.  I would even make it known to the property manager that I don't want the tenant knowing I'm the owner.  Some may not do it that way, but it would help keep the tenant from asking you for things instead of the property manager.

Brandon Monaghan · Answer

Another question for everyone... I will be super busy with work and travel while I am living in Denver, could I hire a property manager from the beginning for even when I'm living in the duplex?  Then that prop manager will carry over my side of the duplex also when I move out?

Is it worth buying a duplex somewhere to live in and rent if I will be moving in a year?

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